Department's Arm's Length Bodies

Maria Miller: The trustees of the Independent Living Fund took the decision to close the fund to all new applicants as of June 2010. This decision was taken to ensure the fund remained within its £348 million budget. This followed the decision in March to write to local authorities announcing that from 1 May the fund would only be able to accept new applications from disabled people in paid work of 16 hours or more, in line with the existing priorities set out in its governing trust deed.
	We have considered the circumstances that led to the decision to restrict eligibility and then to close the fund to new applicants. A combination of factors contributed to this situation. The uncertainty and sensitivity of financial forecasting assumptions and a short-notice £11 million reduction in the fund's 2010-11 budget implemented by the previous Administration led to the trustees' decision to restrict eligibility for the fund. The previous Administration failed to approve this decision-which enabled the ILF to live within their 2010-11 budget-until March 2010. The confusion and uncertainty caused by this chain of events is unacceptable.
	The ILF has now put in place a more robust methodology for forecasting future expenditure and has safeguarded the support allocated to the 21,000 existing recipients of the fund. I have asked the Department and the ILF to ensure that all the lessons are learned from this situation and that appropriate procedures are put in place to ensure that the fund's budget remains on track.
	Further compounding the situation was the failure of the previous Administration to take a principled and strategic decision about the future role of the fund. This was despite a comprehensive and independent review of the fund published in 2007 which recommended that the ILF should retain NDPB status until 2009-10 at which point a decision should be made, based on the presumption of the full integration of the funding stream into personalised budgets.
	The coalition Government are committed to ensuring severely disabled people receive the support they need and, working closely with the trustees, we will consider and settle the long-term future of the ILF as part of the forthcoming spending review.